March 25 (Bloomberg) -- Societe Generale SA is on pace to
sell a record volume of structured notes tied to multiple assets
in Asia, which is driving growth for the lender in the market.

The bank’s sales in the region of the so-called hybrid
notes have jumped by about 50 percent this year from the first
quarter in 2012 to the largest amount for any January-March
period, Julien Lascar, regional head of distribution, said in a
phone interview, declining to provide a total figure. Issuance
last year more than tripled to a record in Asia, which accounts
for more than half the lender’s global hybrid-note sales.

“In terms of popularity of the products, I think it’s
growing,” Hong Kong-based Lascar said. “Asia is definitely
outperforming the rest of the world.”

The notes spread risks across a mix of assets to pay annual
coupons higher than 5 percent, he said. Low volatility in
underlying markets is making it harder for issuers to create
attractive terms using single instruments as smaller price
swings reduce the value of options embedded in structured notes.

The investments provide “quite good risk management,”
said Stephen Pau, senior portfolio manager at Veco Invest Asia
Ltd. in Hong Kong, a wealth-management firm that buys structured
notes. “You don’t have to do asset allocation yourself and you
don’t have to keep abreast of markets.”

The Paris-based bank’s hybrid notes sold in Asia typically
use two underlying assets, Lascar said. The lender has a pool of
more than 30 pairs of assets, ranging from equities to
commodities, after mostly using combinations of interest rates
and currencies only in 2011, Lascar said. The latest additions
to reference gauges include equity indexes for the European,
Hong Kong, South Korean and Taiwanese markets, Lascar said.
Among currencies, the yuan and Taiwanese dollar are gaining
popularity, he said. Singapore, Taiwan and Japan are the largest
markets for the products in Asia, with sales in Hong Kong
catching up, Lascar said.

The situation in Europe remains a risk, he said. Lawmakers
in Cyprus rejected a levy on bank deposits on March 19, raising
concern that the debt crisis in the region may worsen. “If, for
any reason, Europe was to show instability again, we know it
will probably mean more questions from our investors about
taking our name,” Lascar said.